India has asked crude oil producers, including OPEC, to price oil at reasonable rates and to provide better commercial terms like enhanced credit period, Minister of State for Petroleum and Natural Gas Rameswar Teli told the Rajya Sabha on Wednesday.
Petrol and diesel prices have shot up to record highs across the country after relentless price increases since early May. Petrol is retailing above Rs 100 a litre in one-and-a-half-dozen states.
In a written reply to questions in the Upper House of Parliament, the minister said the world’s third-largest oil consumer has taken up with producing nations the need to price oil at reasonable levels.
India, which imports almost two-thirds of its oil needs from the West Asia, has sought better commercial terms like optional volumes in yearly supply contracts and larger time to pay for oil bought.
State-owned oil firms have term contracts – guaranteeing a fixed volume of oil in a year – with national oil companies of West Asian nations for import of crude oil, he said.
“Since the past few years, joint negotiations are held by the Ministry of Petroleum & Natural Gas and oil PSUs with national oil companies of West Asian nations for favourable term contracts like the inclusion of optional quantities in term contracts, enhancement of credit limit to oil PSUs in the crude oil import, etc,” he said.
Most oil exporters such as Saudi Arabia and Iraq provide a 30-day credit period – payment for oil bought has to be made in 30 days.